What is the amount of depreciation allowed

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Problem

Robert is a sole proprietor who uses the calendar year as his tax year. On July 20, 2016 he acquired and placed in service a business machine, a 7-year asset, for $50,000.

No other property was acquired in 2016. Robert elects out of bonus depreciation.

a. What is the amount of depreciation allowed in 2016 and 2017 if Sec. 179 depreciation (first-year expense election) was not elected?

b. What is the amount of depreciation allowed in 2016 and 2017 if Sec. 179 was elected?

Reference no: EM131971781

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